Constitutionality of Caps on Medical Malpractice Damages

Plaintiffs who have been injured as a result of medical malpractice are entitled to seek several categories of damages for their injuries. They can recover economic damages, such as medical expenses and lost income, as well as noneconomic damages for “pain and suffering.” While economic damages are easily calculable, based on documentation such as receipts, invoices, and W2s, noneconomic damages can be very difficult to quantify. Jurors are given little guidance on how to determine “pain and suffering,” resulting in inconsistent and seemingly arbitrary jury verdicts. Such unpredictability and disparity in award amounts can impact public confidence in the jury system. Moreover, healthcare providers face uncertainty about their potential exposure in the event they are sued, as well as skyrocketing insurance rates, resulting in an insurance industry crisis in many states.

The impossibility of objectively determining pain and suffering has led approximately thirty states to set caps on the amount of noneconomic damages a malpractice plaintiff can recover. The cap varies from state to state (New York does not have one), and in many states with caps, exceptions are carved out for cases involving wrongful death, permanent injury, or multiple defendants. Courts in a number of states have struck down damage caps as unconstitutional because they deny equal protection of the law to catastrophically injured individuals or infringe on the right to a jury trial on damages. A review of various court rulings makes clear that damages caps remain a controversial aspect of malpractice reform.

Pros and Cons of Limiting Damages for Medical Malpractice

The rationale for capping noneconomic damages in medical malpractice cases has been two-fold. First, by providing predictability it should reduce insurance risk and allow insurers to charge lower malpractice premiums. This should encourage physicians to remain in the state, thereby improving access to health care. (Some states have seen a massive influx of physicians after enacting a damages cap.) Second, there should be a decrease in the practice of defensive medicine, that is, physicians shouldn’t be frightened into ordering unnecessary tests and procedures merely to protect themselves from frivolous malpractice claims.

Opponents of damage caps have stated that they prevent some patients who have been severely injured by physician negligence from being fully compensated for the harm they have suffered. For example, where a young patient will experience a lifetime of pain and suffering, a cap on recovery may deprive the plaintiff of an adequate damage award. Some states with caps have addressed this by excluding certain serious injuries from the cap.

Some States Have Rejected Damages Caps as Unconstitutional

The highest courts of six states (Alabama, Florida, Georgia, Illinois, New Hampshire, and Washington) have struck down as unconstitutional caps on noneconomic damages in medical malpractice cases. Interestingly, in striking down the caps, the courts relied on different constitutional provisions.

The highest courts of six states (Alabama, Florida, Georgia, Illinois, New Hampshire, and Washington) have struck down as unconstitutional caps on noneconomic damages in medical malpractice cases. Interestingly, in striking down the caps, the courts relied on different constitutional provisions. Some held that the cap violated the Equal Protection Clause (Florida, New Hampshire), while others concluded that it was an infringement of the right to trial by jury (Alabama, Georgia, Washington) or that it violated the separation of powers clause (Illinois).

In concluding that the damages cap violates the state constitution’s equal protection clause, the Florida Supreme Court held that “medical malpractice claimants do not receive the same rights to full compensation because of arbitrarily diminished compensation for legally cognizable claims” and that the cap “does not bear a rational relationship to the stated purpose that the cap is purported to address, the alleged medical malpractice insurance crisis in Florida.”

The Supreme Court of Georgia struck down its damages cap because it violates the constitutional right to a trial by jury. The determination of damages rests “peculiarly within the province of the jury.” Thus, a malpractice plaintiff has the constitutional right to “the award of the full measure of damages, including noneconomic damages, as determined by the jury.”

The separation of powers argument that prevailed in Illinois is that the ability to lower damage awards given by a jury is a power held only by the courts. If the legislature limits damage awards by imposing a cap, then lawmakers are exercising a power reserved for judges.

Many States Have Upheld Damages Caps as Constitutional

Courts in multiple states with caps have rejected constitutional challenges similar to those raised in Florida and Georgia. For example, courts in California, Colorado, Idaho, Maryland, Minnesota, Missouri, and West Virginia have upheld damage caps on noneconomic damages in medical malpractice, concluding that they are rationally related to a legitimate state interest - namely, a medical malpractice insurance crisis.

As courts continue to grapple with the constitutionality of damages caps and state legislatures and industry experts debate their effectiveness in reducing insurance costs, the issue is expected to remain a controversial one.